Is Matthews International Corp (NASDAQ:MATW) the right pick for your portfolio? The smart money is becoming less confident. The number of bullish hedge fund bets stayed the same which is a slightly negative development in our experience
At the moment, there are plenty of metrics shareholders can use to analyze publicly traded companies. A pair of the most useful are hedge fund and insider trading sentiment. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the elite money managers can outpace the market by a superb margin (see just how much).
Just as beneficial, positive insider trading sentiment is a second way to parse down the investments you’re interested in. There are many incentives for a corporate insider to drop shares of his or her company, but just one, very clear reason why they would buy. Several academic studies have demonstrated the market-beating potential of this strategy if piggybackers know what to do (learn more here).
With these “truths” under our belt, let’s take a peek at the latest action encompassing Matthews International Corp (NASDAQ:MATW).
What have hedge funds been doing with Matthews International Corp (NASDAQ:MATW)?
At the end of the fourth quarter, a total of 9 of the hedge funds we track were bullish in this stock, a change of 0% from the previous quarter. With hedgies’ sentiment swirling, there exists a few notable hedge fund managers who were upping their stakes significantly.
Of the funds we track, Pzena Investment Management, managed by Richard S. Pzena, holds the most valuable position in Matthews International Corp (NASDAQ:MATW). Pzena Investment Management has a $16 million position in the stock, comprising 0.1% of its 13F portfolio. On Pzena Investment Management’s heels is Ariel Investments, managed by John W. Rogers, which held a $10 million position; 0% of its 13F portfolio is allocated to the stock. Some other peers that hold long positions include David Dreman’s Dreman Value Management, Ken Griffin’s Citadel Investment Group and Jim Simons’s Renaissance Technologies.
Because Matthews International Corp (NASDAQ:MATW) has witnessed bearish sentiment from the entirety of the hedge funds we track, logic holds that there is a sect of funds that slashed their entire stakes in Q4. Interestingly, Israel Englander’s Millennium Management dropped the largest stake of the “upper crust” of funds we watch, worth an estimated $1 million in stock.. Cliff Asness’s fund, AQR Capital Management, also sold off its stock, about $0 million worth. These moves are interesting, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).
What have insiders been doing with Matthews International Corp (NASDAQ:MATW)?
Insider purchases made by high-level executives is best served when the company in question has seen transactions within the past six months. Over the last six-month time frame, Matthews International Corp (NASDAQ:MATW) has seen zero unique insiders buying, and zero insider sales (see the details of insider trades here).
Let’s go over hedge fund and insider activity in other stocks similar to Matthews International Corp (NASDAQ:MATW). These stocks are Sims Metal Management Ltd (ADR) (NYSE:SMS), Mueller Industries, Inc. (NYSE:MLI), Haynes International, Inc. (NASDAQ:HAYN), Schnitzer Steel Industries, Inc. (NASDAQ:SCHN), and AZZ Incorporated (NYSE:AZZ). This group of stocks belong to the metal fabrication industry and their market caps are similar to MATW’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|Sims Metal Management Ltd (ADR) (NYSE:SMS)||6||0||0|
|Mueller Industries, Inc. (NYSE:MLI)||21||1||4|
|Haynes International, Inc. (NASDAQ:HAYN)||8||0||1|
|Schnitzer Steel Industries, Inc. (NASDAQ:SCHN)||11||0||0|
|AZZ Incorporated (NYSE:AZZ)||15||1||9|
With the results demonstrated by Insider Monkey’s time-tested strategies, retail investors must always keep an eye on hedge fund and insider trading sentiment, and Matthews International Corp (NASDAQ:MATW) applies perfectly to this mantra.